Invest
Stamp duty significantly slowing path to purchase for FHB
Saving for a home takes years for the typical first-time buyer. In Australia’s largest cities, as much as two years are spent simply building up the funds to pay the cost of stamp duty, according to new data.
Stamp duty significantly slowing path to purchase for FHB
Saving for a home takes years for the typical first-time buyer. In Australia’s largest cities, as much as two years are spent simply building up the funds to pay the cost of stamp duty, according to new data.
State and federal government schemes currently offer stamp duty relief and deposit guarantees for first home buyers depending on the purchaser’s income bracket, location, and the price of the property they want to buy. But according to Angus Moore, an economist with PropTrack, those policies may help some first home buyers buy sooner, but there’s a more systemic problem at play that should be addressed.
“Even with concessions in place, for first-home buyers targeting entry-level homes, stamp duty significantly slows the path to purchase,” Mr Moore said.
“For many first-home buyers, it is saving the 20 per cent deposit – rather than servicing the mortgage once they have one – that is the constraint on homeownership,” he noted.
In Sydney, the purchase price for a typical entry-level home for a first home buyer sits at $750,000; in Melbourne, it’s $610,000. As housing prices have risen, so too has the time it takes to save a deposit.
PropTrack’s data shows that 10 years ago, a typical Sydney buyer spent 4.4 years saving for a home deposit. Now it takes 7.1 years. In Melbourne, that duration has elongated from 4.5 years to 6.1 years. Meanwhile, in the country’s smaller markets, that figure has remained largely consistent at roughly four years for both Brisbane and Adelaide.
But stamp duty still accounts for a significant portion of the time spent saving in all of these locations, Mr Moore reported.
“Stamp duty for an entry-level home adds around an extra year of saving in most cities. For more expensive, median-priced homes, stamp duty adds an extra two years’ worth of saving in Sydney and Melbourne and between one and 1.5 extra years in other cities,” he said.
Mr Moore acknowledged that stamp duty concessions for first home buyers in Canberra, NSW, Victoria, Queensland, Western Australia, and Tasmania do help. But all of these programs, except for the ACT’s, place caps on the maximum price of a home that a first-time buyer can purchase.
In Sydney, the first home buyer concession reduces deposit-saving time by around half a year for a relatively affordable home for some buyers. In Melbourne, the concession reduces saving time by as much as one and a half years.
But Mr Moore noted that the caps restrict the savings to only a certain demographic of first home buyers with a restricted set of needs.
“While a more-affordable, entry-level, home may benefit from stamp duty concessions, even median-priced dwellings will not in almost all states,” Mr Moore noted.
“In particular, the caps mean that few detached houses are eligible. Instead, first-home buyers are mainly restricted to apartments. This is not the case in Canberra, as the concession there has no price cap and so all dwellings are eligible”.
RELATED ARTICLES
About the author
About the author
Property
Hidden cost, higher prices: Why a council fee fight matters for Australia’s housing pipeline
A dispute between the Housing Industry Association and Goulburn Mulwaree Council over development cost estimates is more than a local skirmish—it spotlights a systemic pricing lever that can compound ...Read more
Property
Why Aussie homes are turning into stepping stones for the new generation
A new cohort of buyers is treating their first property as a launchpad, not a destination—and the mortgage industry is pivoting in lockstep. Read more
Property
Rate cuts ignite an upsizing wave: how to win the next phase of Australia’s housing cycle
Cheaper money is reviving borrowing capacity and confidence, and upsizers are back in force — most visibly at auctions where clearance rates have lifted to yearly highs. The ripple effects extend ...Read more
Property
Rate anxiety fades, affordability bites: What Australia’s property market shift means for business
Australian buyers are no longer driven primarily by interest rate fears; the binding constraint is affordability. New research shows price pressure, not policy moves, is shaping behaviour—forcing ...Read more
Property
South Australia's first-home buyer boom fuels a frenzy for lenders, builders and retailers
South Australia has quietly become the nation’s most active first‑home buyer market, fuelled by falling rates, generous state incentives and a responsive broker ecosystem. Read more
Property
Melbourne’s turning point: the 2025 playbook for investors—and the 2026 upside
After lagging other capitals, Melbourne is quietly moving off the floor. Prices have logged several consecutive months of growth, rental markets remain tight, and forecasts point to a sharper upswing ...Read more
Property
Brisbane hits the million-dollar mark as growth takes a detour and investors eye new opportunities
Brisbane has crossed the symbolic $1 million median for houses, but the more investable momentum is in units—and the growth curve is flattening. Read more
Property
North platform adds household reporting feature to boost adviser efficiency
AMP's North platform has launched consolidated household reporting across multiple client accounts, helping financial advisers streamline their client review processes. Read more
Property
Hidden cost, higher prices: Why a council fee fight matters for Australia’s housing pipeline
A dispute between the Housing Industry Association and Goulburn Mulwaree Council over development cost estimates is more than a local skirmish—it spotlights a systemic pricing lever that can compound ...Read more
Property
Why Aussie homes are turning into stepping stones for the new generation
A new cohort of buyers is treating their first property as a launchpad, not a destination—and the mortgage industry is pivoting in lockstep. Read more
Property
Rate cuts ignite an upsizing wave: how to win the next phase of Australia’s housing cycle
Cheaper money is reviving borrowing capacity and confidence, and upsizers are back in force — most visibly at auctions where clearance rates have lifted to yearly highs. The ripple effects extend ...Read more
Property
Rate anxiety fades, affordability bites: What Australia’s property market shift means for business
Australian buyers are no longer driven primarily by interest rate fears; the binding constraint is affordability. New research shows price pressure, not policy moves, is shaping behaviour—forcing ...Read more
Property
South Australia's first-home buyer boom fuels a frenzy for lenders, builders and retailers
South Australia has quietly become the nation’s most active first‑home buyer market, fuelled by falling rates, generous state incentives and a responsive broker ecosystem. Read more
Property
Melbourne’s turning point: the 2025 playbook for investors—and the 2026 upside
After lagging other capitals, Melbourne is quietly moving off the floor. Prices have logged several consecutive months of growth, rental markets remain tight, and forecasts point to a sharper upswing ...Read more
Property
Brisbane hits the million-dollar mark as growth takes a detour and investors eye new opportunities
Brisbane has crossed the symbolic $1 million median for houses, but the more investable momentum is in units—and the growth curve is flattening. Read more
Property
North platform adds household reporting feature to boost adviser efficiency
AMP's North platform has launched consolidated household reporting across multiple client accounts, helping financial advisers streamline their client review processes. Read more
